IDFA Urges Vilsack to Avoid Dairy Cliff

WASHINGTONIf you watched the morning news today, you likely heard that the price of milk could double in 2013, costing consumers as much as $8 per gallon. Here's the problem: The 2008 Farm Bill expires on Dec. 31, so unless Congress comes to quick agreement on new farm legislation, USDA will have to revert to a  1949 dairy price subsidy that requires the government to purchase milk at inflated prices.

The International Dairy Foods Association (IDFA) sent a letter to Secretary of Agriculture Tom Vilsack urging him to use his authority to avoid this dairy cliff."

"This type of situation is not new, as farm bills have been extended many times," said Connie Tipton, IDFA president and CEO. "The Secretary of Agriculture has ample authority to postpone and even avoid any negative impact of a delay in passing a new farm bill, and we expect USDA will take careful and deliberate actions to avoid short-term market disruptions."

The letter reads, in part: In the event that no action is taken by Congress prior to the end of the year, we urge you to consider other legal authorities that are available to mitigate the impact of the 1949 Act. If you conclude that you are required to proceed with implementation, we urge that you proceed in a thoughtful and deliberate manner using the formal rulemaking process. This will enable stakeholders, not just dairy producers and processors but also food manufacturers, food retailers, consumers and others, to voice their concerns prior to the implementation of any new rule."

Although a sudden and unpredictable increase in milk prices may result in a short-term financial windfall to dairy producers, the immediate implementation of the 1949 Act would dramatically increase government spending, would force consumers to pay significantly more for dairy products and would impose long-term damage to the dairy industry."